Question
Anvils Works' requires, on average, 2,600 tons of aluminum each week, with a standard deviation of 1,000 tons. The lead time to receive its orders
Anvils Works' requires, on average, 2,600 tons of aluminum each week, with a standard deviation of 1,000 tons. The lead time to receive its orders is 9 weeks. The holding cost for one ton of aluminum for one week is $12. It operates with a 0.99 in-stock probability.
- On average, how many tons does it have on order?
Note: Round your answer to nearest integer.
2. On average, how many tons does it have on hand?
Note: Round your answer to nearest integer.
3. If its average inventory was 13,500 tons, what would be its average holding cost per week?
Note: Round your answer to nearest integer.
4. If its average inventory was 7,000 tons, what would be its average holding cost per ton of aluminum?
Note: Round your answer to 2 decimal places.
5. Suppose its on-hand inventory is 5,300 tons, on average. What in-stock probability does it offer to its customers? Hint: use the =NORM.S.DIST(z,1) Excel function.
Note: Do not round intermediate calculations or your z value. Round your final answer to 4 decimal places.
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